Life Insurance for Seniors

Life insurance is one of the most popular insurances where the insurance company pays a death benefit to the named beneficiaries upon the death of the insured. There are two main types of life insurance; the whole life and the term life insurance.

The life insurance premiums significantly change depending on the age of the insured. This applies to both term life and whole life insurance. While most insurance companies are going to be shy away from approving term life insurance to seniors who are over 70, it is possible to get insured that way in some cases.

Whether you look for term life or whole life insurance, the prices are going to vary. Whole life insurance tends to cost higher than term life insurance while the death benefit is much larger compared to term life. Also, age, gender, medical history, tobacco usage, and multiple other factors change the monthly premium of the life insurance.

In general though, most life insurance company’s prices are going to be at a similar level. The applicant’s overall health and situation will make the biggest impact on the price of the insurance plan.

Term Life Insurance vs. Whole Life Insurance

If you want your death benefit to be a big amount, the whole life insurance tends to be better. Because the coverage lasts throughout your entire lifetime and as you pay your monthly premiums, you’ll have a substantial emergency fund and death benefit in your account.

Term life insurance, on the other hand, is a safer approach. If you want to be covered for a certain time, it is the best option and the monthly payments are way lower than whole life insurance. For seniors below the age of 65, we don’t recommend whole life insurance as the payments are significantly higher and it will last your lifetime. Instead, you can opt for a term life insurance and be covered while paying about $100 or so monthly.

Life Insurance for Seniors
Pexels / Tristan Le

Seniors who are over 65, on the other hand, will have a hard time getting term life insurance for 30-years which is the coverage that you should aim when buying term life insurance. In these scenarios, you have two options. Go for a 10 or 15-year term life insurance or get whole life insurance. Below, you can see different term life insurance plans for each age group.

Term Life Insurance Plans for Seniors

From the tables below, you can how much you are expected to pay for different coverage amounts. The tables contain term life insurance policy prices for ages between 40 to 60.

AgeSexCoverage Amount20-year term life30-year term life
$1 million
$1 million
AgeSexCoverage Amount20-year term life30-year term life
$1 million
$1 million
AgeSexCoverage Amount20-year term life30-year term life
$1 million
Not available with most insurance companies
$1 million
Not available with most insurance companies

Whole Life Insurance Plans for Seniors

Whole life insurance can be an excess payment or such a blessing depending on your situation. If you’re young and healthy, you can get a whole life insurance policy and build up a lot of cash value early on. If you’re young, you can also see this as an investment. However, there is a catch. When you’re making your monthly payments, it functions like loan payments rather than contributions to a savings account.

If you want to take some of the cash from the cash value you’ve saved up over the years, you’ll have to borrow. So you must put the money back in a certain time otherwise you will be subjected to interests. That’s one of the biggest drawbacks of whole life insurance as you are likely to pay interest on your own money.

Cash Value in Whole Life Insurance

Along with the death benefit, you’ll save a cash value which will contribute to your death benefit. If you ever need, you can take a portion of the saved up money but you’ll have to put it back within a certain period. Borrowing against the cash value really does serves as an investment train for retirement. So the whole life insurance can serve you as an alternative to manage your finances easily.

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